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$8.9M shortfall has Kauai contemplating service cuts

By Associated Press

LAST UPDATED: 02:02 a.m. HST, May 03, 2014

LIHUE » Kauai County Council members are considering tax increases and service cuts to cope with a projected $8.9 million budget shortfall.

County officials had hoped for a larger share of the transient accommodation tax the state levies on hotel rooms. State lawmakers raised the cap on the counties' portion of those revenues, to $103 million from $93 million.

The state's four counties had sought a return to the 44.8 percent share they used to receive. Their haul would have been $165 million in fiscal 2013 under that model.

The Garden Island newspaper reports that Kauai's share of the transient taxes will rise by $1.4 million. The county had hoped for about $8.6 million more than that.

Kauai's budget shortfall owes mostly to collective bargaining raises for county employees approved last year.

"Many alternate scenarios are being considered," Kauai Mayor Bernard Carvalho said. "We must meet our obligations and balance our budget, and are trying to do so without further burdening our taxpayers or sacrificing critical services."

Officials contend that the counties bear the brunt of providing services for visitors. In Kauai, an island of about 70,000 residents that receives more than 18,000 visitors daily, that strain is significant.

"We may have to look at freezing any public services going forward, which may include housing expansion, additional bus increases, lifeguarding shifts and, of course, the increase in cost as it deals with solid waste," Kauai County Council Chairman Jay Furfaro told the paper. "We have already, in this budget cycle, planned on some property tax increases. Solid-waste tipping fees and motor vehicle weight tax are still being considered, but our revenue sources are about exhausted."

To cope with the shortfall, the county might reduce its contribution to employees' health plans to 73 percent from 100 percent.

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saywhatyouthink wrote:
Cut back all of the outrageous benefits given to county employees. 21 days of sick leave and vacation per year. 60% family medical, pension and medical benefits for retirees. Cut it all, the private sector has already taken these steps, time for the public sector to follow suit. It's but a matter of time, taxpayers cannot afford to provide these benefits anymore. Civil servants should be happy to just have a job that pays a fair wage in today's world.
on May 3,2014 | 03:50PM
localguy wrote:
Once again union greed hits another part of the Nei. From the multi billion dollar pension money pit to more pay raises to what ever they want. All new union employees should have been moved to the 401k plan when it started 20 years ago then the Roth IRA. This would have worked well to reduce long term pension debt. For failing to make the move, the Nei, like other states, is being buried by union pension greed. Not to worry. There is no more money to cover their retirement pay, state will issue IOUs payable in 50-75 years.
on May 3,2014 | 07:30PM
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